Jonathan Sheppard is editor of www.toryradio.com and contested Bassetlaw at the 2005 general election.
At the outset I must confess I have a vested interest in the future success of Royal Mail. I started my career as a humble mail room boy and have four years’ worth of pension contributions which I would dearly like to see some day. Even if that wasn’t the case, my experience of having worked in the Public Affairs department for a number of years has convinced me that any Conservative should be wholly supportive of Royal Mail reform.
Yet when it was announced that a Labour Government was pushing forward plans to part privatise Royal Mail, I nearly fell off my chair. Not because I don’t think it’s the right thing to do, but because it makes no sense for them to pick this fight at this moment in time.
Some bloggers have argued that as the Conservatives are in opposition, they should of course oppose this measure. I take a different view. Given as a party when we were last in power we proposed to privatise all of Royal Mail, why on earth would we object to private involvement now?
Let’s not forget that out of the whole network of Post Office branches –
they are all private businesses apart from the 500 or so directly
operated ones – there is already a strong history of private
involvement in part of the Royal Mail Group.
The Government in its proposal have wisely stated that Post Office Ltd
which, operates the nationwide network of sub post offices, is not
included. They have therefore already neutralised any argument that
could be put forward that part-privatisation will lead to post office
closures. It is of course interesting to note that some of those
Labour MPs who now object to part privatisation of Royal Mail are the
very same ones who voted for the Urban Reinvention programme which
effectively used taxpayers’ money to shut post office branches.
The proposal put forward by the Government is now focused on the
letter and parcel business, which is historically where the Royal Mail
has made the bulk of its profit. The problem is Royal Mail is no
longer in the same position as it was in the 1980s.
20 years ago it was almost treated as a cash cow by Government. It made
millions and the Government took the money and didn’t allow the company
to invest as it should have. So were mistakes made? I suspect so. The
same happened with the pension fund. The company took a pension holiday
in the good years and now it has a huge deficit.
We now have emails, faxes, text messages and aggressive competitors
just waiting to cherry pick business from Royal Mail. That is a reality
that has to be faced.
Industrial relations were a problem when I worked there and it’s still
an issue to this day. Some reports suggest strikes at Royal Mail
account for up to 60% of days lost due to industrial action in the
economy – a shocking statistic. Can that be solved by tinkering around
the edges or does there need to be more radical reform? I suggest the
Opponents are already up in arms. Some are suggesting that before there
is any partial sell off, postal prices should be allowed to increase. I
totally agree. Compared to the rest of Europe, our postal prices are far
too low. To be able to send a letter from Cornwall all the way to the
Highlands for 36p is a nonsense. It’s pretty good value to get it
delivered within London! But price rises alone won’t solve the long
term decline of Royal Mail which perhaps private capital and expertise
What perplexes me the most is surely this is one fight the Government
didn’t need. The Conservatives should support, because it’s the right
medicine for what is a sick patient. The Lib Dems proposed something
similar only a couple of years ago and should also be supportive.
If it wasn’t such a serious issue I would have a wry smile just looking
at who is most up in arms over this move, namely Labour backbenchers
and Labour’s paymasters, the Unions. Why they have picked a fight with
their own side, and the Group they will be begging to fund their
election campaign, is beyond me.
Wouldn’t it be ironic to see a move pushed forwarded by arch Blairite
Lord Mandelson, being so savaged by Labour backbenchers and the Unions,
that one final backtrack is performed, and the issue of Royal Mail
sounds the last post on Brown’s tired premiership?
Royal Mail can’t just be propped up and allowed to go into terminal
decline. To prevent it facing a death of a thousand cuts, any
Conservative should back plans to reform this once proud world-beating
organisation, even if a side effect of that support would be to help
Gordon Brown out of another mess of his own making.